WEST LAFAYETTE, IN – Rising geopolitical tensions are again exposing how dependent agriculture is on global fertilizer supply — and what that means for input costs and competitiveness. Research from Purdue University’s Center for Commercial Agriculture economist Joana Colussi highlights growing risks tied to disruptions in key trade routes, such as the Strait of Hormuz.
The Persian Gulf region supplies a significant share of global nitrogen and phosphate fertilizers, and shipping restrictions have driven fertilizer and energy prices higher. That pressure is showing up in grain-to-fertilizer ratios, which remain near multi-year highs, squeezing producers’ margins.
The United States produces roughly 60 percent of its fertilizer needs but still relies heavily on imports for key nutrients — especially potash, about 95 percent of which is imported. Dependence on phosphate and nitrogen imports has also increased in recent years, leaving the U.S. exposed to supply shocks.
Brazil faces even greater risk, importing nearly 90 percent of its fertilizer needs, including about 96 percent of potash and 95 percent of nitrogen. That higher exposure puts Brazilian producers at a sharper disadvantage when global disruptions hit.
Farm-Level Takeaway: Fertilizer supply risk remains a key cost driver.